You know, I wish I could sit down with some of you people and just breathe knowledge for an hour or two. I always find it almost "exciting" listening in on my dad's business meetings or during negotiations/talks. Hope you don't mind me slipping that post into my stash of quotes.
You know, I wish I could sit down with some of you people and just breathe knowledge for an hour or two. I always find it almost "exciting" listening in on my dad's business meetings or during negotiations/talks. Hope you don't mind me slipping that post into my stash of quotes.
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Just put in my few points, I would never make a "set and forget" investment, the main reason for me is I don't find monitoring my investments a chore like some people do, I actually enjoy it. I am always seeking new ways of getting my money to work harder for me, like for instance 2 years ago I was at a single malt tasting and one of the guys there started a whisky portfolio a few years back and to date his return is over 400% on outlay. Ever since I have been collecting scotch and have seen returns in 3 digits (doubt it will be the same for 10+ years) Good news about scotch is if it doesn't go up you can still drink them! Sorry getting sidetracked, if you are really interested in shares now is either a great time to buy or a bad time to buy, depends if which way you look at it. When I was 17 I traded shares under my mothers name and managed to half my $6000 (which felt like a million back then) in about 3 months. I learnt a lot about those three months including listen but don't believe a thing people say, make your own judgement.
I think you have right idea about capital preservation, at the moment a term deposit with one of the big banks is probably only going to give you a small profit after you take in inflation. I bought my first house at 19 and I know how hard it was for me to get a loan because of my age, even though I had a 20% deposit and a managerial job in a well established company.
One of the things I think you should also look at is if you are working and have a super account, the government will match extra co teibutions up to $500 I think it is now, play around with a super calculator and you will be pleasantly surprised what $25-$50 a week extra will have on your final balance, considering you'll probably love to 100+.
Anyway food for though
I think you have right idea about capital preservation, at the moment a term deposit with one of the big banks is probably only going to give you a small profit after you take in inflation. I bought my first house at 19 and I know how hard it was for me to get a loan because of my age, even though I had a 20% deposit and a managerial job in a well established company.
One of the things I think you should also look at is if you are working and have a super account, the government will match extra co teibutions up to $500 I think it is now, play around with a super calculator and you will be pleasantly surprised what $25-$50 a week extra will have on your final balance, considering you'll probably love to 100+.
Anyway food for though
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@ TMC93 A mate and I have an ongoing joke about investing, he is always joking around that I should be spending my time investigating scotch whiskey investments rather than the sharemarket. According to this he might not have been too far from the mark:
http://au.pfinance.yahoo.com/educat.../scotch-whisky-a-better-investment-than-gold/
@philworld The super co-contributions is a great way to multiply your money without any special expertise/hard yakka. I have been chucking in the 1 grand every year for the past 4 and a bit years, plus the compulsory 9% has added up to over 17 thousand dollars. I would prioritize putting cash into this to claim the maxmimum amount, over learning how to invest in the sharemarket/realestate market. I have also set my super fund to 100% be in bonds, over every single period since inception (including the GFC, greek/euro crisis) it has returned 5-7% which is relatively boring when taken alone but very much worth it when taken in conjunction with the 100% instant return you get from the government (this juices up the return on your invested capital to 10-14% very low risk). Back when I started contributing while working at KFC the government gave you 150% of your contribution up to 1000 dollars, since reduced to matched 1 for 1 for the 1000 dollars. You don't have to have a job/taxable income in order to claim this bonus from the government so it's a win/win starter investment. It's a good place to start building a base of assets.
http://www.ato.gov.au/individuals/content.aspx?doc=/content/42616.htm
Another MAJOR tip I'd give you is to not buy a car in highschool/university and to instead save the money. If your parents feel it is their obligation to give you a car for university insist on receiving cash instead to invest/save. Even if you buy a cheapie 3-5 thousand dollar car it'll add up for petrol/insurance/maintenance, when you're just starting out every single dollar counts so much more.
If you're getting 'interested' in shares and the sharemarket invest in a copy of Warren Buffets biography "The Snowball" and read Benajamin Graham's "The Intelligent Investor" then continue onto "Security Analysis". IF you can manage to smash all those out you'll learn the majority of what fundamental investing is all about.
http://au.pfinance.yahoo.com/educat.../scotch-whisky-a-better-investment-than-gold/
@philworld The super co-contributions is a great way to multiply your money without any special expertise/hard yakka. I have been chucking in the 1 grand every year for the past 4 and a bit years, plus the compulsory 9% has added up to over 17 thousand dollars. I would prioritize putting cash into this to claim the maxmimum amount, over learning how to invest in the sharemarket/realestate market. I have also set my super fund to 100% be in bonds, over every single period since inception (including the GFC, greek/euro crisis) it has returned 5-7% which is relatively boring when taken alone but very much worth it when taken in conjunction with the 100% instant return you get from the government (this juices up the return on your invested capital to 10-14% very low risk). Back when I started contributing while working at KFC the government gave you 150% of your contribution up to 1000 dollars, since reduced to matched 1 for 1 for the 1000 dollars. You don't have to have a job/taxable income in order to claim this bonus from the government so it's a win/win starter investment. It's a good place to start building a base of assets.
http://www.ato.gov.au/individuals/content.aspx?doc=/content/42616.htm
Another MAJOR tip I'd give you is to not buy a car in highschool/university and to instead save the money. If your parents feel it is their obligation to give you a car for university insist on receiving cash instead to invest/save. Even if you buy a cheapie 3-5 thousand dollar car it'll add up for petrol/insurance/maintenance, when you're just starting out every single dollar counts so much more.
If you're getting 'interested' in shares and the sharemarket invest in a copy of Warren Buffets biography "The Snowball" and read Benajamin Graham's "The Intelligent Investor" then continue onto "Security Analysis". IF you can manage to smash all those out you'll learn the majority of what fundamental investing is all about.
@TMC93
It's more your hobby than your investment I'm assuming? However, I think It's really cool that you are making money from doing something you are passionate about!
I like the idea of the extra super contribution and taking advantage of what the government has to offer, but honestly, I don't like the idea of storing the money away for a period of time that seems like an ETERNITY to me. Of course this is probably because I am young and foolish.
@ParleVouFrancois
My mum is really excited about me driving (getting my license this month (provided that I pass the test(Are multiple brackets grammatically correct?))).
She probably WILL get me a car.
I believe you are right. My grandpa bought a car for $800 and insurance + fuel + rego etc costs much more than $800 every year.
Thanks a lot for your advice though.
____________________________________
On another note, I have been thinking these couple days about another way I could make some cash.
About ten years about when we first came to Australia, my dad negotiated a deal with an Aussie man for a few containers of toilet paper dispensers, letter boxes, etc and I was the 6 year old interpreter(my dad knew 0 English and basically is still about the same).
Last night I remembered about this and started talking about it with my dad. I asked him what happened with that order in the end, if we made any money, etc etc.
Turns out that we did make some money.
He also mentioned that we STILL have the molds for the products in China and it would still be 100% viable to make them.
There is nothing proprietary about the products and it isn't branded (however this could be an option).
They are just plain, ordinary, pieces of metal.
I know for sure that we can still get manufacturers in China and we are also able to pay after we receive money.
We are also able to ship our products out on containers WEEKLY.
The only problem that I am facing is I don't know how to find a customer.
Do I just contact distributors in Australia?
How do I even find them?
I also lack knowledge of the market.
We would make revenue of under or around 30%.
Could you guys tell me what you think about this?
Could It work?
Thanks,
Philworld
It's more your hobby than your investment I'm assuming? However, I think It's really cool that you are making money from doing something you are passionate about!
I like the idea of the extra super contribution and taking advantage of what the government has to offer, but honestly, I don't like the idea of storing the money away for a period of time that seems like an ETERNITY to me. Of course this is probably because I am young and foolish.
@ParleVouFrancois
My mum is really excited about me driving (getting my license this month (provided that I pass the test(Are multiple brackets grammatically correct?))).
She probably WILL get me a car.
I believe you are right. My grandpa bought a car for $800 and insurance + fuel + rego etc costs much more than $800 every year.
Thanks a lot for your advice though.
____________________________________
On another note, I have been thinking these couple days about another way I could make some cash.
About ten years about when we first came to Australia, my dad negotiated a deal with an Aussie man for a few containers of toilet paper dispensers, letter boxes, etc and I was the 6 year old interpreter(my dad knew 0 English and basically is still about the same).
Last night I remembered about this and started talking about it with my dad. I asked him what happened with that order in the end, if we made any money, etc etc.
Turns out that we did make some money.
He also mentioned that we STILL have the molds for the products in China and it would still be 100% viable to make them.
There is nothing proprietary about the products and it isn't branded (however this could be an option).
They are just plain, ordinary, pieces of metal.
I know for sure that we can still get manufacturers in China and we are also able to pay after we receive money.
We are also able to ship our products out on containers WEEKLY.
The only problem that I am facing is I don't know how to find a customer.
Do I just contact distributors in Australia?
How do I even find them?
I also lack knowledge of the market.
We would make revenue of under or around 30%.
Could you guys tell me what you think about this?
Could It work?
Thanks,
Philworld
Hi Phil,
While import/export is a good way to make money, it's not as simple as it seems and can be very competitive. Basically you need to be compliant to any Oz standard if applicable, you will almost certainly under estimate costs.
Also your customer may not pay you up front (or at all) and if you don't sell from the ship/wharf storage and distribution costs can be quite high eating into any profit.
My suggestion is to to avoid it unless you know what you are doing, have deep pockets or are really planning on starting a business. Also you will need to have good reputation which takes time to build. Difficult to do this part time if you get my gist unless you are looking at niche markets.
Also some advise which you may or may not like. You are what 15? Don't get too worked up about making money, you'll burn your self out. Have some fun!
It was compliant 10 years ago, not sure now, but I'm assuming it is or isn't far off.
We are able to actually keep stock AT the wharf in China.
I understand that my situation isn't optimal because I can't dive in but it is just an idea.
To compensate for my lack of reputation I am willing to not take a deposit.
Is it enough? I don't know but I have my doubts.
And your right, this is DEFINITELY not a niche and people WILL probably kick my ass.
Yes I'm turning 16 soon. I do like that advice =]. I'm by no means "obsessed" with making money or with money. I just have interest in the finance and business world and have come to see what I could possibly do with my money. I honestly do have problems socializing with people my age, most of my friends are older than me... or do I just have problems socializing?.. haha don't really know. But yeah, I'm trying to not care as much and just lose a bit of tension but I just can't relate to most people.
Thanks again.
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I used to sell *ahem* adult movies when I was in high school. $75/video. The interwebs has probably killed that industry off though. Made a killing and much easier than shipping things in from China!
I used to sell *ahem* adult movies when I was in high school. $75/video. The interwebs has probably killed that industry off though. Made a killing and much easier than shipping things in from China!
supply and demand... supply and demand...but $75?!?!? Who were your customers? Kids at school? Thats some big money
Julia
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I used to sell *ahem* adult movies when I was in high school. $75/video. The interwebs has probably killed that industry off though. Made a killing and much easier than shipping things in from China!
Well, who'd have thought it, McLovin. Enterprising little chap, weren't you!
white_goodman
BOC
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year 7 and 8 kids... had someone similar at our school... (the 'pornking')
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I believe it's what economists call inelastic demand.
Don't worry Julia, not all my businesses were as "blue". When I was six I used to make friendship bracelets and sell them at after school care, by ten I was selling about $100/day worth of lollies. When the principal shut me down, I called her communist, which went down well.
I like small little businesses for something to do on the side. I still do it, now I buy and sell bikes and bike parts. For something that started completely by accident (a bike frame was too big for me so I had to sell it) it's surprisingly profitable, especially with all the hipsters wanting fixies. When I came back from overseas a couple of years ago, unemployed, I bought a pizza place that was struggling and "restructed" it ("gourmet" pizzas, free home delivery, really basic stuff that works) then sold it. It was private equity on a micro scale!
Julia
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I'm reassured we're not likely to be reading about you as head of some dubious enterprise, McLovin.
Admire your entrepreneurial capacity.
Admire your entrepreneurial capacity.
Can a 15 year old get a loan? Trade shares?
10K hey, strange as that's exactly the amount needed to open an IB account...just a coincidence or fate???
The required minimum on IB for individuals aged 26 or younger is $3,000 going by the website. Is this for only US residents?
-------
You'd need to trade under your parents name Phil until you're 18.
I'll be watching this thread
Phil,
Firstly good on you for taking a healthy interest in your financial future. If you are interested in shares, I'd whack the whole $10k in a high interest online savings account while you read up about the pros and cons of the stock market. At least then you are earning 4 or 5% while you learn.
As noted previously, you would have to trade under mum or dad's name until you turn 18, and they would have to pay any taxes earned on dividends, though this shouldn't put you (or them) off.
Do a bit of "Googling" and read some good books, including Sir O's thread mentioned previously. Then read it again, take notes on the info which would help you.
Decide on a strategy. If your current net worth is $10k, do you want to put the whole lot into the market? You are turning 16 soon, and I'd guess you'll be looking at cars soon... they can get expensive - not just buying one but running the thing as well... with cars come girls - you thought cars were expensive!
What I'm getting at is the stock market should (IMO) be looked at as a long term venture, and it can be bad to put your money in and then want to withdraw in a year or two - the whole lot because you've found a car, or met someone special.
Lets say after you do a bit of reading, talk to Dad about it all, and make some more contributions to your $10k, it's grown to 12... One option may be to keep $4k in the bank, and invest the $8k. Re invest the dividends into whatever stock you think is the goods, and try to add amounts from your income as you go.
A strategy I often recommend to people starting out is to sign up to a broker of your choice. CBA offers 12 free trades within 3 months ($20 thereafter), NAB has just launched a new platform offering 20 free trades over 3 months ($15 or 16 thereafter). Minimum purchase $500 bundles, which could work, but are generally not worth it when you start paying brokerage. There are others out there - Bendigo I know does it as well as some online brokers such as Bell and CMC. They all have their own pros and cons. Going with a bank broker your Dad banks with MAY have a benefit.
Pick your shares - do your own research and make your own decisions. Banks are generally regarded as safe, as are some of the bigger LIC's. In my opinion, you are best off having a decent % of your total investment in "safer' stocks before you even contemplate "day trading" or taking on a bigger risk. If you sign up with a broker with free trades as a start up bonus, plan what you are going to invest in in advance, and create a strategy to do it. There's no rush - try to look at this as a long term strategy which will help you immensely in your financial future.
Most importantly, take your time - read up all the information you can, And have fun. The market WILL rise and it WILL fall - don't get freaked out by this, you still own the shares.
Stew.
Firstly good on you for taking a healthy interest in your financial future. If you are interested in shares, I'd whack the whole $10k in a high interest online savings account while you read up about the pros and cons of the stock market. At least then you are earning 4 or 5% while you learn.
As noted previously, you would have to trade under mum or dad's name until you turn 18, and they would have to pay any taxes earned on dividends, though this shouldn't put you (or them) off.
Do a bit of "Googling" and read some good books, including Sir O's thread mentioned previously. Then read it again, take notes on the info which would help you.
Decide on a strategy. If your current net worth is $10k, do you want to put the whole lot into the market? You are turning 16 soon, and I'd guess you'll be looking at cars soon... they can get expensive - not just buying one but running the thing as well... with cars come girls - you thought cars were expensive!
What I'm getting at is the stock market should (IMO) be looked at as a long term venture, and it can be bad to put your money in and then want to withdraw in a year or two - the whole lot because you've found a car, or met someone special.
Lets say after you do a bit of reading, talk to Dad about it all, and make some more contributions to your $10k, it's grown to 12... One option may be to keep $4k in the bank, and invest the $8k. Re invest the dividends into whatever stock you think is the goods, and try to add amounts from your income as you go.
A strategy I often recommend to people starting out is to sign up to a broker of your choice. CBA offers 12 free trades within 3 months ($20 thereafter), NAB has just launched a new platform offering 20 free trades over 3 months ($15 or 16 thereafter). Minimum purchase $500 bundles, which could work, but are generally not worth it when you start paying brokerage. There are others out there - Bendigo I know does it as well as some online brokers such as Bell and CMC. They all have their own pros and cons. Going with a bank broker your Dad banks with MAY have a benefit.
Pick your shares - do your own research and make your own decisions. Banks are generally regarded as safe, as are some of the bigger LIC's. In my opinion, you are best off having a decent % of your total investment in "safer' stocks before you even contemplate "day trading" or taking on a bigger risk. If you sign up with a broker with free trades as a start up bonus, plan what you are going to invest in in advance, and create a strategy to do it. There's no rush - try to look at this as a long term strategy which will help you immensely in your financial future.
Most importantly, take your time - read up all the information you can, And have fun. The market WILL rise and it WILL fall - don't get freaked out by this, you still own the shares.
Stew.
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stewiejp,
I like your post, particularly this bit!
So easy to forget during a crisis.
Win, lose or draw; I love sharetrading!
Congadulations on 10K starting points. Investing can be a risky business if you don't know how to go about it or were to start. 10k can go a long only invested in any place or market. Fx Options are always a choice for capital investments, as I have learnt. How ever investing in stocks you want to be flexible and on top of your profit compound. Blue chips are good and all, but your profit compound may be limited.
As you may well know investing in stocks needs a good scanning system to find the stocks you need. A portfolio etc. may I recommend to that you that you purchase and become a member of Equity Smart. As a friend a fellow investor whom uses Equity Smart, can safely tell you its a Win Win. Other programmed software that cost thousands and are hype full of swing. Equity Smart will cost you a few hundred dollars members and 45 dollars a month data. And you get the lot. The best system you could ever use, given you have the integrity to trade as a Investor and not a Amateur . Excellent choice to start of big and trade the ASX low capped market for extra returns and massive results.
http://www.equitysmart.com.au/
There is so much to learn if you start trading - and it may be wise to do it with the support of paid advice - there are many companies that provide advice in trading options, CFDs, shares, FX, commodities and while it is possible to trade in demo accounts, the real learning comes with trading with real money - although in amounts small enough to pay for the learning without doing too much damage at the start to the funds.
Regarding car space rental ... I found this (and you will be able to locate it easily) ... It confirms the comparison to leaving your money in the bank ... and the info is tainted by being provided by the person who benefits.
Car Parking Spaces
The mounting scarcity of car parking spaces in Sydney and Melbourne is giving quite a boost to the niche investment parking space market.
Brett M...., joint CEO of S.... Parking, which operates and manages around 180 car parks around Australia, says that some parking spaces in Sydney CBD have sold upwards of $80,000. The average cost of one in Kings Cross or Ultimo would be $50,000.
Sold through real estate agents, car park spaces give a consistent return of 6.0% to 8%,the rents are usually indexed to inflation (handy if high inflation hits) are fully managed, and would usually be managed by a reputable operator on long leases.
Capital Growth is usually tied to the rental increase. In other words, if rents go up 4% per annum, that is you capital growth.
In Melbourne, expect to pay anywhre between $35,000 to 70,000 for a well located, high yielding space.
But they are very safe and secure, and it is sure better than leaving your money in the bank!
Newer car parks, in desigbnated office buildings, will be easier to manage and will give higher returns than private car parks offered by individuals in residential buildings
Regarding car space rental ... I found this (and you will be able to locate it easily) ... It confirms the comparison to leaving your money in the bank ... and the info is tainted by being provided by the person who benefits.
Car Parking Spaces
The mounting scarcity of car parking spaces in Sydney and Melbourne is giving quite a boost to the niche investment parking space market.
Brett M...., joint CEO of S.... Parking, which operates and manages around 180 car parks around Australia, says that some parking spaces in Sydney CBD have sold upwards of $80,000. The average cost of one in Kings Cross or Ultimo would be $50,000.
Sold through real estate agents, car park spaces give a consistent return of 6.0% to 8%,the rents are usually indexed to inflation (handy if high inflation hits) are fully managed, and would usually be managed by a reputable operator on long leases.
Capital Growth is usually tied to the rental increase. In other words, if rents go up 4% per annum, that is you capital growth.
In Melbourne, expect to pay anywhre between $35,000 to 70,000 for a well located, high yielding space.
But they are very safe and secure, and it is sure better than leaving your money in the bank!
Newer car parks, in desigbnated office buildings, will be easier to manage and will give higher returns than private car parks offered by individuals in residential buildings
